Online Social Networking for Business:
An Interview with Konstantin Guericke, Marketing VP, LinkedInBy Debbie BardonBardon On Call ResearchOnline social networking is a hot topic in Internet
circles. These online communities claim to create networks
of friends and business colleagues based on referrals
from other friends and colleagues. They connect people
based on who those people know rather than who they are.
Think of it as accessing not only your Rolodex but also
those of your neighbors. Most rely on recommendations—you
have to be invited into the community. Once you accept
the invitation, you can then invite others. Some social
networks are, indeed, purely social. They exist to promote
dating. Others have more business utility—members
use the network to find and fill jobs, locate consultants
and subcontractors, and identify people with like business
interests. A newer wrinkle is bringing the technology
in-house to facilitate knowledge sharing. Social networking
companies include Friendster, Tribe, Spoke, ZeroDegrees,
Ryze, Orkut, and LinkedIn.

But what do online
researchers, information professionals, and librarians
stand to gain from these virtual communities? ONLINE
asked Debbie Bardon, a noted telephone researcher based
in Oakland, Calif., to investigate.

—Marydee Ojala
Several months ago, a trusted business client and associate
invited me to join his network of contacts on LinkedIn
[www.linkedin.com].
Because I respect the savvy of this individual, I accepted
his invitation, but I was unsure how this might benefit
me. Interviewing Konstantin Guericke, marketing VP at
LinkedIn, when at a local event gave me the opportunity
to learn more about this new concept of online social
networking for business and how to use it.

LinkedIn is an online service designed to help professionals
find and connect with one another. Users contact each
other through a network of connections for the purpose
of looking for jobs, business leads, and industry information.

Guericke most recently served as VP of marketing at
Presenter, where he led product marketing, public relations,
and corporate marketing. Prior to Presenter, Guericke
was responsible for the initial public launch of social
software pioneer Blaxxun as VP of sales & marketing.
Other executive roles included EVP at Caligari and project
director, with responsibility for a $10 million product
unit of publicly traded Micrografx. At Beresford Partners,
Guericke helped the CEOs of more than two dozen high-tech
start-ups develop their positioning and marketing strategy.

Tell me a little bit about your background
before joining LinkedIn.

I've always been interested in the link between engineering
and humanities. The parts of computers and technology
that I was most interested in are those areas where
our social behavior and the computer and now the Internet
are most intertwined.

Were you a humanities major in college?

No, my bachelor's and master's degrees are in engineering,
but I was always considered by engineers to be the "least"
engineer or the "softest" engineer because
I took a lot of courses in social psychology and organizational
behavior. At Stanford, I created my own major called
"Organizations, Technology, and Innovation."

How do you define social networking?

A network has to be made up of people and links between
people. So it's all about how people can find and contact
people that they want to reach through the people that
they already know. And that makes it very different
from a database. It's the human connection.

What was the genesis of LinkedIn? How did you
and the other founders come up with the notion for LinkedIn?

We found, in our personal experiences, that a lot of
ourbusiness came to us from people we know and trust.
This included getting recommendations for people to
hire or agencies to hire or, if there was a specific
person we wanted to meet, looking for someone we knew
who could give us an introduction. My personal experience
was as an independent contractor. After 5 years, when
I analyzed where my 32 clients came from, I realized
that all of them, without exception, came from referrals
from people I knew.

What niche were you attempting to fill?

It wasn't a specific niche per se. We felt that the
network only works if there's a certain size and diversity
to it. We did determine that we didn't want to be a
friends and social activity network because we felt
that might water down or take over the professional
aspect of the network. We wanted to make sure that we're
business only. So that's the niche—but it's a
very broad niche.

At first we discussed whether we should just make it
for the service providers. But you always need two parties
to tango, so the service provider needs people in business
who are looking for a service provider. The people in
business need other business partners to do business
with—the hiring managers look for employees, job
seekers need recruiters, entrepreneurs need investors.
So we determined that we shouldn't narrow it down to
one group. Networks work because there is diversity.
The human intermediaries on LinkedIn are crucial to
creating the right match. This is what makes LinkedIn
different from a database that is matching up people
according to their stated needs.

Who are you marketing to?

In essence, we're not doing any marketing. It's really
more of a question of how we decide to design the product.
We've never placed an advertisement. We've never sent
an e-mail campaign or any kind of marketing program—97
percent of the members of LinkedIn joined because someone
invited them to join.

We market sort of indirectly by what features we put
in the product and by what information we put on the
Web pages that you see. So, from that perspective, we
market from the way we designed the product so that
it's focused on the needs of the most senior members—the
executives, hiring managers, venture capitalists. If
we didn't design the product for them, then they would
very quickly leave the network after they had joined.
And of all the people who might leave the network, those
people would be the most important to keep because that's
why a lot of other people join. So if we can have a
lot of executives and hiring managers in the network
and design the product to work really well for them,
then the people who are seeking jobs or entrepreneurs
who are seeking investment will come.

If you haven't done any marketing per se, can
you explain to me where your subscribers have come from?

In May of last year, the executive team who started
LinkedIn sent out 50 to100 invitations to the professionals
we each knew and told them what we're doing—"We're
starting this company and would like you to invite your
contacts, and eventually this will be a product that
you can use." We now have 1.2 million subscribers.

Were all of you in the same geographic area
when you sent out your invitations?

Yes, we're all located in the San Francisco Bay Area.
So the week after we launched, almost all of the members
were in this area. However, I'm German, so I invited
a couple of Germans. Some of us had lived in other parts
of the U.S., and one of the co-founders is from France,
so there were a few people from other areas to start
with. But what we've seen is that the percentage of
people from outside of the Bay Area has steadily increased
so that now 90 percent of the members are outside the
Bay Area and 49 percent are outside the U.S. But there
was no marketing program to get people from other areas.
It was just a natural outgrowth of the network. I think
it says less about LinkedIn and more about the nature
of business, especially at the senior levels, that a
lot of people do business with people in other countries
and around the United States. I think, perhaps, starting
in the San Francisco Bay Area may have been beneficial
because it's such a diverse area. People come from all
over the world to go to school and work here. If we
had started somewhere else, like Kansas for example,
it might not have diversified so quickly.

How do you measure the success of LinkedIn?
Do you have any statistics or success stories?

It goes back to the definition of what a social network
is. Do you find and reach the people you need? That's
really more important than how many people are in the
network. But the two are related because the more people
that are in the network, the more likely that you will
find the person you're looking for. So the number of
people is an ingredient. Most important is the contact
request that people make. Where person A says I want
to contact person C, and asks their friend, person B,
to make the introduction. In the end, that is the real
purpose of the network. Last month, we had 36,000 of
these referrals. And people do write in and post messages
about how LinkedIn has helped them in some way.

Do you have any idea of how many of these referrals
result in a positive outcome?

We don't know that because it happens after people
make contact. We do know that most of those referrals
were accepted by the recipient. We track that because
we're often asked whether it's important that there
is an intermediary. Statistically, your chances of getting
a response from someone you don't know by direct mail,
telephone, or e-mail are only 2 percent. That's the
classic direct response rate that is recognized by marketers.
But people accept 83 percent of our requests, which
dramatically illustrates the importance of being introduced
rather than cold-called in our age of information overload.

Are people currently using LinkedIn in ways
that don't fit the original paradigm?

We didn't have too many preconceptions. We basically
modeled LinkedIn after eBay because we felt that it
is the strongest Internet company. They took the idea
of the garage sale and connect people to buy and sell
goods. The Internet itself, of course, is a network,
and so connecting people to people always seemed like
the most natural fit with the Internet.

There are some ways that people are using LinkedIn
that we hadn't thought of that have kind of surprised
us. For example, organizers of conferences and trade
shows are using LinkedIn to find and recruit speakers.

Who do you consider to be your biggest competitors?
Hoover's lists Craigslist, Friendster, and thesquare.
com as your main competitors. A Web site called the
Social Networking Meta List [http://socialsoftware.weblogsinc.com/entry/5214444809933077/],
posted by Judith Meskell, lists no less than 48 business
networking sites. What sets LinkedIn apart from other
business networking sites?

First of all, I would define our competition as the
alternative ways that people are solving the problem
now. So I'd look at our competition as the established
practices of traditional networking because changing
people's behavior is the hardest thing we have to do.

In terms of other online business networks, it comes
down to what network a person decides to join. Some
people will join multiple ones, but I tend to think
that waters down the effectiveness. Most people won't
want to invite their business connections to join multiple
networks, so they select the one they think will be
the most effective. In terms of which online business
networking site is looked at most closely as an alternative
to LinkedIn? That would be Ryze [www.ryze.com]. They
have the second-largest number of users. LinkedIn has
the largest number of users with 700,000. After Ryze,
none of the other business networking sites has any
significant number of users. The biggest factor that
sets LinkedIn apart from Ryze is that Ryze doesn't have
a referral mechanism.

Someone mentioned Orkut [www.orkut.com]
to me. How is LinkedIn different or the same as Orkut?

Orkut is well-known and it's growing, but it's not
a business networking site. You could use it, but it's
not designed for business networking. For example you
can't put your resume up on Orkut. You can't search
for people by the criteria of what jobs they have had.
They ask users to upload their photograph, and your
network of users rate how sexy they are. The demographic
makeup of social networks like Orkut and Friendster
is predominantly under 30 years old. Our users are more
established. You wouldn't use LinkedIn to try and build
a network from scratch if you are just starting out.

What benefits does LinkedIn offer that your
competitors like Ryze don't?

Anyone who is registered on Ryze can contact anyone
else that is on Ryze, whereas our users are reachable
by referral only. And that is a benefit to our high-end
users. The more senior you are, the more you want to
protect who can contact you. Since Ryze doesn't have
the referral mechanism, it attracts more people who
want to be more approachable. It's a different demographic.

Very specifically, how would independent consultants
effectively use LinkedIn?

I believe that the best way to get new clients is to
attract them to you. So on LinkedIn there are three
things you want to do to use LinkedIn in attraction
mode.

The first thing you want to make sure of is that your
profile is completely filled out. You want to list everything
you've done professionally, all your specialties, and
all your colleges. Last month people made 1 million
searches on LinkedIn. The only way people find you is
to type something into the search engine.

The second feature that LinkedIn offers is endorsements.
So you should ask some of your professional contacts
to write endorsements for your profile. If people are
searching for someone in your category, having even
one endorsement increases your chances of your profile
being looked by 400 percent.

The third part is to have as many high-quality connections
as possible. You want to keep your connections to people
that you know and trust. Since the only people who can
find you on LinkedIn are people who are within four
degrees of separation from you, it's beneficial to have
the largest number of connections possible. When you
go into your network page, you can see how many people
you are connected to and also how they are broken down
geographically and by industry.

How about other information professionals?
How would they effectively use LinkedIn?

If they are looking for business or wanting to be found,
they should follow the attraction approach that I just
described. However, there is also the hunting approach.
The first step is still to build your network, because
the more people you have in your network, the more people
you can reach when you do your searches. You also want
to have a good profile and endorsements, but you're
really focusing on the search feature. One example of
how information professionals in the knowledge industry
might use LinkedIn is if they are looking for an industry
expert on a topic they are researching, they might be
able to find that person on LinkedIn. On the home page
there is a simple search that you can do of your network
for key words.

Is there anything else that you'd like to add
about LinkedIn?

I think the one thing people should know is that we're
very strict about privacy. If you upload your address
book on LinkedIn, no one else can see it. There are
some other sites where, if you upload your contacts,
they're published. Another thing is that when you do
a search, nobody shows up who hasn't opted in to LinkedIn.
Every relationship on LinkedIn has to be accepted mutually
by each party. LinkedIn is certified by Trust-E and
is even certified in the EU, which has stricter privacy
standards than the U.S. Finally, you should know that
you will never receive spam as a result of registering
with LinkedIn.

After talking with Guericke, I have a much better understanding
of online social networking for business. I see this
as one more tool I can use to potentially build my business,
as well as help friends and associates link up with
others for their mutual benefit.

Debbie Bardon[dbardon@aol.com]
is an independent research consultant and sole proprietor
of Bardon On Call Research.